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"..."Homeowners should be walking away in droves," Brent T. White, a University of Arizona law school professor, said in a recent paper. "The financial costs of foreclosure, while not insignificant, are minimal compared to the financial benefit of strategic default..."
Would you walk away??
Strategic Defaults and the Foreclosure Crisis - Yahoo! Finance (http://finance.yahoo.com/news/Strategic-Defaults-and-the-usnews-2190373684.html?x=0&mod=loans - broken link)
Walking away is not always a smart thing to do. Some states are deficiency balance states. That means if you owe 200K on a house, the current market value is 150K, and the bank auctions it off after foreclosure for 100K you still owe them 100K.
Walking away is not always a smart thing to do. Some states are deficiency balance states. That means if you owe 200K on a house, the current market value is 150K, and the bank auctions it off after foreclosure for 100K you still owe them 100K.
But the lenders are so overwhelmed with these cases and it's hard to get blood from a turnip. Garnishing wages is an extremely difficult proposition.
But the lenders are so overwhelmed with these cases and it's hard to get blood from a turnip. Garnishing wages is an extremely difficult proposition.
That doesn't mean that they can't or won't come after people. They could file suit and win a judgement which appears on one's credit report and will be there for life until it is somehow resolved. That would make it impossible to ever buy another property and likely hinder obtaining any other froms of credit.
That doesn't mean that they can't or won't come after people. They could file suit and win a judgement which appears on one's credit report and will be there for life until it is somehow resolved. That would make it impossible to ever buy another property and likely hinder obtaining any other froms of credit.
FHA doesn't really care about credit, as long as you have a stable job. Wait 2 years and then apply for a 3% down loan. If the tax credit still exists (probably won't but you never know), just apply it towards the down payment. No down payment loan with destroyed credit. Ain't America grand?
I think it stinks to high heaven, but that's just the way it is. All loans should be non-recourse since the house is the collateral. If the bank doesn't feel quite right making the loan, well that's what PMI and a down payment are for.
The new American motto. "When times are tough, only think of yourself".
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